The Big Question: Ready to Move or Under Construction Property?

The Indian real estate scene has witnessed major changes post-RERA that came into effect from 01st May 2017.

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The Indian real estate scene has witnessed major changes post-RERA that came into effect from 01st May 2017. With regulation coming to the aid of buyers, offering a shield of protection, it should have appeared easy to decision makers to choose between a ready to move flat or one that is under construction. However, many factors rule the decision making process, and buyers are often torn between both the types of choices. It calls for a calculated decision, one that is supported by factors that meet specific individual requirements. Let’s dwell on some of the more important points that help to determine the better choice.

Money does matter

Regardless of how you intend to finance your acquisition, the amount that moves from your account to that of the seller does differ in both the types of purchase. If you opt for a ready to move flat, your outflow or loan exposure will be in one single tranche of payment. If you are looking at an under construction property, your payments will be staggered, meaning that your money stays with you longer. And, if you actually happen to change your mind about ownership, you can expect a decent appreciation in value – this, of course depends on factors like period, property value, stage of completion etc. So, if your finances are strong enough and you do not mind it, then you can opt for a ready to move house. However, if you need to carefully plan your finances, an under construction home is a better choice.

Timelines or worry lines?

One of the common failed expectations of home buyers is the inability of some developers to deliver projects on time. This causes considerable dissatisfaction among buyers who dream of moving into homes in a particular period. A ready to occupy home will typically not face these issues, as the homes will be ready. However, with RERA coming into effect, home owners can heave a sigh of relief as developers face a penalty for delay in handing over completed projects. While the penalties may not actually come as a bonus to the prospective buyers, it certainly acts as a deterrent. And reputed builders roll out projects to a plan, which ensures that timelines do not become worry lines.

Actual appearance of completed projects

Home owners are typically shown display dwelling units, model homes or sample homes to prospective buyers. These set the expectations for buyers in terms of décor, finish, carpet area etc. However, in some instances buyers end up with properties that are different from expectations.  A ready to move home will not set any expectations as the everything is right there before you.  However, with the right developer, and RERA guidelines on carpet area, you can rest your apprehensions.

GST

Under construction homes have extra 12% GST burden, which ready to move properties dont.

While the debate will continue to rage for as long as can be, with arguments on either side of the choice, you can easily arrive at a decision. If you have zeroed in on a location, and a property is under construction, it would definitely pay to opt for it. Not only will you be spending lesser, you will be able to set up home in the chosen location. With the right developer and RERA to protect your interests, you can be sure that your apprehensions are allayed.

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